2020 was a tough year for credit unions and other businesses around the country. Many were forced to make fast and difficult changes to satisfy their member and customer needs. As the future of brick-and-mortar remains uncertain, credit unions must take advantage of all the opportunities and resources that are available to them.
Fortunately, every year the National Credit Union Association provides grants through the Community Development Revolving Fund (CDRLF) to qualifying CUs to help them expand access to financial products and services in their communities. In 2021, 1.5 million dollars in total grant money will be awarded to credit unions that qualify and apply before the deadline.
If your CU serves underserved communities and is looking for resources to help you expand services to your members, a grant from the NCUA could be an excellent way to help you achieve your goals in 2021.
The Underserved Outreach Initiative from the NCUA
One initiative featured in this year's CDRLF, made available to low-income credit unions, is the Underserved Outreach initiative. This initiative is intended to assist credit unions in implementing innovative outreach strategies in their communities to increase access to financial products and services.
Here are some details of this initiative and what you must do to apply:
- How much is the grant? In 2021, the maximum Underserved Outreach initiative grant is $50,000. There is no minimum award.
- What are the goals of the Underserved initiative? The goal of the initiative is to improve the financial health of individuals in underserved communities by increasing equity, expanding economic inclusion and closing the wealth gap by offering financial products and services.
- How can the money be used? The grant can be used in three ways:
- To expand outreach efforts,
- To expand financial education, or
- To expand financial products and services to people in low-income communities.
- What are some specific examples of how CUs can use the money? CUs can use the Underserved Outreach grant to provide small business or workforce training programs for minorities interested in starting or growing their business, to develop new products that are tailored to underserved groups or minorities, or to create partnerships with other organizations to help the needs of low-income individuals or households.
- How can I apply? To apply for a grant, CUs must be designated as low-income through the NCUA. To determine if your CU is eligible, you should review the full application and instructions at the NCUA organization.
This initiative ultimately focuses on providing quality financial products and services to underserved population segments such as minority groups, youth & millennials, veterans, and immigrants. This grant could allow credit unions to fund projects that benefit individuals returning to the community following incarceration, promote first-time homeownership, and improve the access of financial products and services to people with disabilities. The goal of this initiative is for credit unions to employ outreach strategies that produce positive growth outcomes for the credit union and improve the financial health of individuals.
There are also two other grants available for low-income designated credit unions through NCUA’s Community Development Revolving Fund in 2021. They include the Minority Depository Institution (MDI) mentoring award (max award $25,000) and the Digital Services and Cybersecurity grant (max award $7,000). These grants are a great way for low-income credit unions to expand financial services, products and education to the people in their communities.
Besides taking advantage of the available resources, it’s also important that credit unions continue to make wise choices about how they expand their digital and member services moving forward. One way to improve such services is by choosing forward-thinking, advanced credit union core technology. Learn how one credit union affected change in their organization by reading our case study.